Presence of external economies creates a natural entry

Reference no: EM13690154

Using a graph show (and discuss) that the presence of external economies creates a natural entry barrier for new entrants when there is an incumbent industry, even when the new entrant has a lower average cost of production. In such a scenario, discuss two options for trade policy that might help the new entrant capture some (or all) market share.

Reference no: EM13690154

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